Catalog retailer L.L. Bean didn't do its homework before filing lawsuits against advertisers of the Claria Corp., the adware provider alleged in a statement Wednesday.
Claria filed a lawsuit
against L.L. Bean on June 3. The suit comes after the Freeport, Maine-based cataloger filed separate lawsuits against four of Claria's advertisers for allegedly violating its rights by advertising
with Claria. In its lawsuit against L.L. Bean, Claria claims that the retailer's "frivolous" filings against its advertisers are part of a "sham" litigation strategy "attempting to intimidate"
competitors.
Claria has drawn the ire of several Web publishers and merchants. Its tracking software, which users download in exchange for access to premium content or other software at no cost,
sends information to its server so that ads and promotional offers can be targeted to users at an opportune time--such as when they're about to make a purchase on another retailer's Web site.
L.L.
Bean is one angry Web publisher currently involved in several multi-district litigation suits against Claria. Recently, the company changed its strategy to filing suits directly against Claria's
advertisers, rather than the adware provider itself.
Claria stated that L.L. Bean's claims of trademark infringement are unfounded because its advertisers buy inventory by category, and not by
name or trademark. Furthermore, the company said that two of the companies sued by L.L. Bean--Nordstrom and JCPenney --don't use Claria's services and haven't done so for well over a year, while one
of the remaining two companies has never been a Claria customer, and the other had never purchased inventory in the apparel category.
"This move by L.L. Bean reveals that they are fearful they
cannot win on the legal merits of their long-standing lawsuit against Claria," Claria CEO Jeff McFadden said in a statement. "We are outraged by L.L. Bean's irresponsible tactics, and have asked the
court for damages relating to their reckless actions and anti-competitive and anti-consumer behavior," he added.
JupiterResearch analyst Gary Stein said that Claria's offensive stance bodes well
for its pending initial public offering (IPO). "It shows that they so firmly believe in their business model that they're going to fight," he said, noting that this is "good to do" in advance of an
IPO.
He said that the real story here is that L.L. Bean didn't do its due diligence before filing the lawsuits. Stein noted that one way for disgruntled publishers to fight back against adware
providers is to file lawsuits in an attempt to frighten competing advertisers. He said that once an executive spots the controversy, the executive will often prohibit marketers from working with such
companies in order to preserve brand equity. He added that he hasn't noticed a significant shift in the interactive advertising community's attitude toward adware. "Some still have an issue with it;
some don't," he said.
Despite the controversy, Stein noted that venture capitalists he spoke with recently at Ad:Tech in San Francisco are very interested in the contextual and behavioral
targeting space, of which adware is a component. Claria, which has entered into a quiet period prior to its IPO, declined to comment for this story.